A mutant of Bacillus subtillis 168 that has osmotically fragile protoplasts has been isolated. This mutant has an active phospholipase A1 localized in its plasma membrane. In contrast, membranes of the wild type do not manifest a phospholipase activity, but contain an inhibitor of the phospholipase A1 present in the mutant. Efforts are underway to characterize the inhibitor and the phospholipase after purification of each, and to study the mode of action of the inhibitor. In a related study, a number of phospholipases have been demonstrated in E. coli. Several of these appear to be soluble; current work should resolve the question of whether or not they are located in the cytoplasm or in the periplasm.